The Nigerian National Petroleum Company Ltd has opened talks with the United States Finance Corporation and China Exim Bank to seek financing for its multi-billion-dollar gas projects.
The Group Chief Executive Officer of the NNPC Ltd, Mele Kyari, disclosed this at the Nigerian International Economic Partnership held in New York on Thursday.
Kyari said, “Inclusion (in energy transition) means that we need to be supported. We are already talking to the US DFC, the EXIM so that they can give us financing and funding for our gas projects and this is very critical, so that we can have that flexibility to move forward and at the back of this.
“I’m sure some of you may be aware that today, we are getting a grant to build baseline carbon emission studies in our country by the United States Government and this is very helpful in the sense that Mr. President has also asked that we need to be supported. Currently, the major source of financing we are having is from the African Exim.”
Nigeria’s transition to net zero by 2060 requires enormous investments in gas projects which is the country’s transition fuel.
Kyari however said Nigeria is looking for opportunities to leverage on the enormous gas resources in the country to provide the possibility that is required for the energy transition.
It will cost $410bn to transit, according to the federal government and huge gas projects like the recently signed Memorandum of Understanding between the NNPC, ECOWAS Commission and Morocco to deliver pipelines along the African corridor will gulp billions of dollars.
“We are embarking on massive infrastructure and to see how we can deliver the Morocco gas pipeline which will pass through a number of countries to provide a number of securities including bringing people out of poverty and also an opportunity that are there that we are doing also in the domestic market, increasing more gasses in the domestic market,” he said.
But the most pressing issue affecting the country’s income is crude oil theft which is estimated at 700,000 barrels per day.
The government has set mechanisms to tackle the issue which is currently frustrating fresh investments in the sector.
For instance, the NNPC has initiated a reward system for whistle blowers, while security agencies and host communities have been incorporated in the fight against oil thieves.
Kyari said, “In the oil and gas industry today, there is a huge challenge around oil theft in our country clearly a security issue. It is not beyond containment, as the Honourable Minister has also mentioned earlier on, there are so many things that our government security agencies are doing.
“We are collaborating with our partners and stakeholders and that is coming down very drastically. But it also needs international collaboration to come to close on this.
“What we need here is the collaboration of buyers anywhere in the world. Today, we have gotten to where any purchaser of Nigerian crude anywhere in the world can be validated, we will confirm that it is the real, because there is no transaction in this industry that does not pass through the banks system and I’m happy seeing a number of bankers here. There is no where you can sell crude oil anywhere without passing through the banking system.
“That is why we need help from the international banking institutions and more than anything is that we can easily validate what we are doing. Those numbers are clear now. “
The NNPC boss however, acknowledged that issues around energy sufficiency and inclusion is a critical challenge anywhere around the world.
He noted that Africa’s largest oil exporter is very conscious of the “effect of our business in terms of emissions and impact on climate. No doubt about it. The world is doing so much about it.”
Kyari added, “Our country is committed to net zero by 2060, but that is a pathway. There must be a pathway of providing energy sufficiency and inclusion as we move forward. And therefore, the world has accepted gas as a transition fuel. There is no alternative to it today so that you can bring the basic need that is required.”